From the Liveblog of
Friday, January 12, 2024
Container rates soar amid concerns of prolonged Red Sea disruption
Container shipping rates for key global routes have soared this week, with US and UK air strikes on Yemen stirring concerns of a prolonged disruption to global trade in the Red Sea, one of the world’s busiest routes, industry officials say.
US and British warplanes, ships and submarines launched dozens of strikes across Yemen overnight in retaliation against Iran-backed Houthi forces for attacks on Red Sea shipping, widening regional conflict stemming from the Israel-Hamas war.
The benchmark Shanghai Containerized Freight Index was up over 16 percent week-on-week to 2,206 points today.
Rates on the Shanghai-Europe route rose 8.1% to $3,103 per twenty-foot equivalent unit (TEU) on Friday from a week earlier, while the rate for containers to the US West Coast soared 43.2% to $3,974 per forty-foot-equivalent-unit (FEU) week on week, leading ship broker Clarksons says.
“The longer this crisis goes on, the more disruption it will cause to ocean freight shipping across the globe and costs will continue to rise,” Peter Sand, chief analyst at freight platform Xeneta, says.
“We are looking at months rather than weeks or days before this crisis reaches any kind of resolution,” he says, referring to the growing conflict.
